Financial institution of America’s 2026 market outlook paints an image of sturdy international development, led by AI funding, however warns that volatility might rise as buyers start to know the total impression of the expertise on the financial system.
The financial institution’s international analysis staff expects U.S. GDP to develop 2.4% year-over-year by the top of 2026, above consensus, pushed by enterprise funding, fiscal stimulus, and up to date fee cuts. China’s development can be projected to beat expectations, with forecasts at 4.7% for 2026 and 4.5% in 2027.
However probably the most vital drive shaping the financial institution’s forecast is synthetic intelligence.
The surge in AI spending is already lifting GDP and BofA doesn’t see a bubble — but. “We’re optimistic on the 2 most influential economies,” mentioned Candace Browning, head of BofA international analysis. “Considerations about an imminent AI bubble are overstated.” In response to the report, AI-related capital funding is poised to broaden additional subsequent yr, supporting what some economists imagine might change into a brand new funding cycle.
Bitcoin BTC$91,878.33 miners have benefited from the AI increase in 2025, as surging demand for high-performance computing has pushed up the worth of their infrastructure. A number of publicly traded mining corporations reported elevated income this yr not simply from mining, however from leasing out knowledge heart capability to AI firms in want of power-hungry GPUs.
IREN (IREN) is up 337.15% year-to-date whereas Cipher Mining (CIFR) is buying and selling practically 300% greater. TeraWulf (WULF) is up 190% over the identical interval. The positive aspects as come at the same time as bitcoin has didn’t convincingly escape this yr, persevering with to commerce across the $90,000 space.
In impact, markets are shifting from a consumption-led restoration to at least one pushed by capital expenditure, infrastructure, and productiveness. If that shift holds, it might ripple past conventional equities and into areas like digital infrastructure, blockchain, and knowledge monetization — domains the place crypto tasks have staked a declare.
Nonetheless, the financial institution sees turbulence forward. As buyers and policymakers develop a clearer image of how AI impacts inflation, labor markets, and provide chains, monetary markets might expertise sharp shifts. BofA warns that the continued “Ok-shaped” restoration, the place some sectors soar whereas others lag, provides complexity to this outlook.
That disconnect might deepen if AI amplifies productiveness in tech and finance whereas leaving slower-moving sectors behind. The outcome: a two-speed financial system that’s tougher to handle with conventional instruments. For markets, it raises the danger of mispricing and sudden revaluations.
Rising markets might profit within the close to time period, particularly if the U.S. greenback weakens and oil costs keep low. BofA notes that these areas are prone to see stronger efficiency in 2026, helped by international financial easing. For some growing international locations that skipped legacy infrastructure in favor of digital methods, rising AI demand might create new openings for different applied sciences.
Nonetheless, the tone of the report is cautiously upbeat. With two Fed cuts projected in 2026 and monetary coverage nonetheless operating scorching, the financial backdrop stays supportive, no less than for now.
In a yr the place copper costs are rising on the again of provide constraints and monetary enlargement, and S&P earnings are anticipated to develop 14% regardless of muted worth positive aspects, the market appears primed for change. Whether or not AI turns into a productiveness engine or a supply of instability might be one of many defining questions of the subsequent twelve months.
And in that debate, crypto — particularly in its extra infrastructure-focused types — might have a task to play, even when it’s not on the heart of the dialog but.
